The number of mortgages being approved has risen by 17% over the past year to reach 69,613 in October, says the Bank of England.
That number is up slightly from September’s figure of 69,012 and it is higher than the six-month average of 68,099 mortgage approvals.
The Bank has also revealed that the mortgages are worth £12.2 billion and economists had predicted the number of mortgage approvals to break through the 70,000 barrier in October.
One economist has pointed out in a national newspaper that the number of approvals is lower than August’s peak which is down to the lack of properties for sale on the market.
House price rises are also pushing up the value of mortgages
Howard Archer is chief economist with IHS Global Insight and he said that house price rises are also pushing up the value of mortgages.
He said: “While housing market activity has picked up during 2015 the easing back slightly of mortgage approvals could reflect the shortage of properties.”
Mr Archer also pointed out that the value of approvals was also probably boosted by the number of people looking to fix their mortgage deals into low rate offerings before a predicted rise in interest rates.
The Bank of England says that the number of remortgages that were approved in October was 39,629, which is a slight fall from September’s figure of 41,000.
People opting to lock into long-term mortgage deals
Peter Rollings, the chief executive of Marsh & Parsons, said lending is looking strong with people opting to lock into long-term mortgage deals before interest rose next year.
He added: “The Chancellor’s autumn statement will also have boosted the number of first-time buyers keen to get their foot in the door.”
He also predicted that buy to let landlords may also boost the number of mortgage approvals as they bid to beat the stamp duty shake-up set for next April when an extra charge will be levied on those who own second homes.
Bridging finance specialist helps release landlord equity
Meanwhile, a commercial bridging specialist has unveiled a product aimed at releasing billions of pounds from the portfolios of property professionals.
JustBridging.co.uk says that research shows that buy to let equity has risen by £70 billion in the past two years as property prices rise – they have risen by 15% in the UK and in London by 30%.
The firm’s director, John Davies, said: “Property professionals are equity rich but options poor and, understandably, the last thing they want is to unlock equity from their portfolio by remortgaging.
Use equity to buy additional properties
“This would increase significantly their borrowing costs and it can be frustrating as they are unable to use equity to buy additional properties or improve their houses.”
Now the firm’s PortfolioBuilder product offers flexible funding solutions to those with commercial property, including buy to let landlords, with funds of between £10,000 and £500,000.